As GII, the state’s largest milk processor announces a further cut reducing their May milk price to a base of 20 cents per litre, the ICMSA has highlighted the latest figures released from the Dutch Dairy Board (LTO) showing that Irish processors lagged substantially behind their European counterparts for April milk prices, with GII paying the lowest price of the 15 major processors surveyed – even before their latest price cut is factored-in.
Describing it as a “most unwelcome and dubious achievement”, the Chairperson of ICMSA’s Dairy Committee, Gerald Quain, said that there had been an uplift in butter prices over the last eight weeks and farmers were justifiably expecting to see prices being held only to now be told that their milk prices – already the lowest featured in this international survey – are to be cut again. Mr Quain said that the figures spoke for themselves and questions arose that demanded answers from the processors.
Three Irish processors were included in the league table for April milk price and compared to twelve other processors across Europe. The results make for stark reading Irish companies make up the bottom two of the league table while the third Irish processor featured is sixth from bottom. GII are bottom of the table with 22.01 euros per 100kg milk with 4.2% fat and 3.4% protein without their ‘top-ups’ included. While Dairygold – included in these surveys since the start of the year – are second from bottom with €22.56 per 100kgs but without any ‘top-ups’ to add to this low price.
The average European price in April returned at 26.29 euros per 100kg, a massive 16% higher than the GII price. Kerry’s milk price is somewhat higher at 23.89 euros per 100kg but it is still 12.46 euros per 100kgs or 34% lower than the highest price available across Europe. These results for April are not just a statistical ‘one off’ noted the ICMSA; the results for the rolling averages for twelve months show that all Irish processors are in the bottom five of the league. These differentials needs to be eliminated and quickly if Irish dairy farmers are to have confidence in their processors, observed Mr Quain.
“Irish farmers are simply looking for a fair reward for their produce and the question becomes: given the excellent quality of our product, how is there such a price differential? Markets are low at present, granted, but why are prices in Ireland so substantially lower than other European countries using the same base price comparison? To a degree, the question of ‘top-ups’ is a distraction, farmer-suppliers are looking at base milk price and wondering why – even before their latest cuts – our processors are paying the lowest price of the 15 processors surveyed on a like-for-like basis. Questions have to be asked about the scale of these discrepancies: why are Irish farmer-suppliers receiving the lowest prices from our processors who, on the basis of their published results, are doing very nicely while the farmers have now spent a full year receiving a milk price recognised as being below the cost of production. We’ll have the usual protestations from the processors about ‘support’ and ‘top-ups’ but the bottom line here is that they’re paying the bottom price of the major EU processors and the facts speak louder than spin”, said the ICMSA Dairy Chairperson.
Ends 15 June 2016.
Gerald Quain, 086-3623041
Chairperson, ICMSA Dairy Committee
Cathal MacCarthy, 087-6168758
ICMSA Press Office